Showbiz Sandbox 365: As Cord-Cutting Grows, Media Company Revenue Falls

May 8, 2017

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Media company stocks took a beating last week with a one-two punch from cord-cutting and a soft ad market. The first quarter of 2017 saw pay cable subscriptions fall by over 700,000 in the United States, the largest ever such loss. This has caused some concern that cord-cutting has accelerated just as major advertisers have started to spend less on marketing.

However, television networks may just be shifting where revenue comes from. Rather than huge carriage fees and ad rates tied to huge viewership, networks may now be earning money off licensing content to streaming video providers and selling ads on digital platforms. There’s just one problem; such digital platforms pay far less than networks used to getting.

Warner Music Group is also suffering from shrinking revenues thanks to consumer migration to streaming online services. The company signed a new licensing agreement with YouTube, but they aren’t happy with a deal they felt forced into accepting. We’ll explain why.

Of course, we also cover the week’s top entertainment news including the multiple “Game of Thrones” spin-offs planned by HBO, Harry Potter heads to Broadway and the return of “American Idol”.

Play

Movies at the Palace
https://www.unitedpalace.org/programs/movies-at-the-palace

comScore Announces Official Worldwide Box Office Results for Weekend of May 7, 2017
http://www.prnewswire.com/news-releases/comscore-announces-official-worldwide-box-office-results-for-weekend-of-may-7-2017-300452807.html

Warner and YouTube Sign New Deal ‘Under Very Difficult Circumstances’
https://www.musicbusinessworldwide.com/warner-youtube-sign-new-deal-difficult-circumstances/

Warner Music Extends Deal With YouTube After ‘Months of Tough Negotiations’
https://variety.com/2017/biz/news/warner-music-extends-youtube-1202410931/

Dinner with DiMaggio by by Rock Positano, John Positano, Francis Ford Coppola
http://bookfilter.com/2016/06/30/dinner-with-dimaggio/

Bill Clinton Teams With James Patterson to Write First Novel
http://www.hollywoodreporter.com/bookmark/bill-clinton-teams-james-patterson-write-first-novel-1001013

‘American Idol’ May Return on ABC — But Fox Still in the Mix
http://www.hollywoodreporter.com/live-feed/american-idol-may-return-abc-but-fox-still-mix-1000285

‘American Idol’ Revival Poised to Move Forward at ABC
http://www.hollywoodreporter.com/live-feed/american-idol-revival-poised-move-forward-at-abc-1000790

Gustavo Dudamel on Repression and Violence in Venezuela: ‘Enough is Enough’
http://www.latimes.com/entertainment/arts/la-et-cm-gustavo-dudamel-venezuela-statement-20170504-story.html

Gustavo Dudamel Has Tried to Stay Out of Politics. Now, He’s Demanding Action in Venezuela
http://www.latimes.com/entertainment/arts/la-et-cm-gustavo-dudamel-interview-20170503-story.html

Dudamel Dedicates Concert to a Slain Student in Venezuela
http://www.latimes.com/entertainment/arts/la-et-cm-gustavo-dudamel-venezuela-schubert-20170507-story.html

Paramount’s China Partners Now Financing 30 Percent of Slate
http://www.hollywoodreporter.com/news/viacom-paramounts-china-deal-is-operation-partners-financing-30-percent-slate-1000160

Viacom Confirms Paramount’s China Slate Financing Deal ‘Moving Forward’
https://variety.com/2017/film/news/viacom-confirms-paramounts-china-slate-financing-deal-moving-forward-1202409017/

‘Harry Potter and the Cursed Child’ Sets Opening Night on Broadway
https://www.nytimes.com/2017/05/04/theater/harry-potter-and-the-cursed-child-sets-opening-night-on-broadway.html

As Best-Seller Lists Are Cut, a Looming Disaster for Publishers
https://theoutline.com/post/1465/after-the-nyt-cut-best-seller-lists-a-looming-disaster-for-publishers

‘Game of Thrones’ Spinoffs in the Works at HBO
https://variety.com/2017/tv/news/game-of-thrones-spinoff-hbo-1202409434/

Television In The Snapchat Age: ‘This Is The Way Of The Future’
https://www.benzinga.com/news/17/05/9405398/television-in-the-snapchat-age-this-is-the-way-of-the-future

Millennium Films Faces Explosive Sex Harassment Suit
https://variety.com/2017/film/news/millennium-films-avi-lerner-sexual-harassment-1202408780/

Former Top BET Exec Claims “Misogynistic Culture” in Discrimination Lawsuit
http://www.hollywoodreporter.com/thr-esq/bet-executive-zola-mashariki-claims-misogynistic-culture-at-network-discrimination-lawsuit-1000170

Former BET Executive Cites ‘Reckless and Inhumane’ Treatment in Wrongful Termination Lawsuit
https://variety.com/2017/tv/news/bet-zola-mashariki-lawsuit-breast-cancer-1202409185/

Cord Cutting and a Soft Advertising Market Take a Toll On Media Stocks
http://www.latimes.com/business/hollywood/la-fi-ct-ad-revenue-media-companies-20170503-story.html

Media Stocks Take a Hit as Cord-Cutting Fears Intensify
http://variety.com/2017/biz/news/media-stocks-time-warner-disney-1202408467/

Comments

  • mgiltz

    Cord cutting! Falling ad revenue! Falling ratings! They’re ALL linked to one fact: people are watching TV in new ways but no one is capturing all those eyeballs. Do you really believe TV ratings are falling 30%? Everyone I know talks about TV and consumes it more than ever. On their phones and tablets, on demand and DVR and binge watching and more. The only thing they don’t do is sit down in front of the box on a certain night at a certain time and patiently watch a new show and all its ads in real time. Start measuring how people are really watching TV and “cord cutting” will be proven a myth and ad sales and ratings will climb back up.